Manufacturing slump ups triple-dip fears

The Office for National Statistics said January's manufacturing output was down 1.5 per cent on the precious month and 3 per cent on January 2012

And total exports have crashed by 3.5 per cent - leaving Britain's businesses £900 million out-of-pocket.

That saw the economy contract by a worse-than-expected 0.3 per cent and has sent the value of the pound plummeting to a two-and-a-half-year low.

Economists warned a further fall in economic performance in the next quarter will put Britain back in recession and trade unions are turning up the heat on Chancellor George Osborne to deliver a Budget for growth on March 20.

Unison general secretary Dave Prentis is among the speakers at tomorrow's TUC pre-Budget rally in Westminster.

He said the gloomy economic forecasts were yet more evidence that the government's cuts agenda is holding back growth.

But he added that giving public-sector workers a decent pay rise could see high-street spending soar and give a timely boost to "beleaguered" shops and businesses across Britain.

"The Prime Minister must put the interests of the country first and initiate a programme of public spending to get the economy working again and avoid a triple-dip recession made in Downing Street," he said.

"We know that public-service jobs have been cut too far too fast - lift the threat of unemployment and people will start buying again - boosting manufacturing."

Unite assistant general secretary Tony Burke added that Mr Osborne's "promise of a march of the makers was a work of fiction by a poor author" and demanded he delivered a "game-changing" budget.

"It would be foolish for the Chancellor to bank on the service sector to rescue the economy," said Mr Burke.

"As part of the budget, Britain needs a strategic manufacturing plan but the government seems a long way from developing one. The government's 'cross your fingers and hope for the best' strategy is predictably failing."